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Ian McKenna: Dispatches from Finovate (Day one)

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Watching 70 presentations in two days is an exhausting experience, as anyone who has been to Finovate will tell you, but it is well worth it because of the range and diversity of ideas presented. As a regular attendee (this is my tenth Finovate) I have found it is valuable to identify the presentations I think have most relevance to the areas I cover and meet with them individually to get a detailed understanding of their propositions.

The following is a quick run through of my favourites from the first day of this year’s West Coast event in San Jose with some extra elements from my one to one discussions.

Behavioural finance teaches us that when considering the value of money in the future people discount its perceived value significantly. Talk to someone about money they are providing for themselves in 20 years’ time and mentally they are discounting its value by 50 per cent. Hip Pocket generate an analysis which shows users how their current level of retirement savings compared to their peers.

The user provides a small amount of information about themselves, high level details about their retirement savings and gets a comparative analysis of their savings against their peer group. Humans are naturally competitive creatures so this provides a great platform for encouraging further saving. A similar service is provided for mortgage comparison. This is an interesting crossover between gamification People Like U and a refreshingly different way to think about achieving customer engagement.

Ticker Tags presented an investment analysis tool based on the level of social media content and how it impacts share prices. This demonstrated a way that public domain information could be used to identify trends which professional analysts might not pick up for several months. Well worth a look.

Stratos Card won my personal “I Want One of Those” award with a credit card sized device which can actually hold all the information from your different credit, debit, store and loyalty cards on a single electronic card. For a $95 annual fee users receive the card with a small device which can plug into your smartphone’s audio socket. You swipe your cards through this and it scans in all the data from the magnetic strips on your credit cards, just like people used to scan CDs into iTunes when they bought their first iPod.

Once you have your card loaded you don’t need to use any other plastic cards – they are all loaded onto this one. It connects with your mobile via bluetooth for access to the data that has been scanned but details of your three main cards are kept individually on the Stratos card so you never have to worry about your phone having run out of power. The card itself has an internal two year battery although as part of the service you are sent a new card, with updated technology every year.

At this point some readers may be thinking “why does this fit in this column, isn’t it about banking?”, but I see enormous potential for linking Stratos with the next generation of financial advice and employee benefit solutions.

In my view the award for the best personal finance innovation on day one of Finovate Spring 2015 must go to Draft App, who have built a simple but highly effective service which allows investors to better understand their investments.

The service first aggregates all the investment and banking accounts of the investor into a single holistic view. Then it assigns a risk category based on a weighted algorithm that combines standard deviation and asset class. Draft assigns actual risk tolerance vs a desired risk tolerance and also shows performance on a  cumulative, YTD, 1, 3, 5, 10 year return, a cumulative fee percentage, and how assets are allocated across classes, styles, sectors, and markets. The user can now see on the same dashboard exactly how their investments compare to the top 10 per cent of portfolios across the whole Draft system.

This is a simple and highly effective tool, and as with so many services presented at Finovate puts most of the investment comparison services served up to UK investors to shame when it comes to delivering a clear comparison which a non-professional investor could be expected to understand.

The service is available both in a direct-to-consumer version or as a white label for adviser firms. In the latter context it could be a very useful vehicle to identify other assets which the adviser might be able to consolidate under their advice.

I will be back tomorrow with a summary of the best offerings from day two of Finovate Spring.

Ian McKenna is director of Finance & Technology Research Centre

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Comments

There are 2 comments at the moment, we would love to hear your opinion too.

  1. Thanks for the coverage!

  2. Very interesting Ian. From a consumer’s point of view, I would like to use all of these:
    Aggregating accounts without manual input. When I started managing our own investments, with shares in 4 different trading accounts,we tried various portfolio apps, but it was a frustratingly useless waste of time. Nothing for it but to shift all into one account. OK most of the time…but they don’t all let you do what you want in the same way, so occasionally annoying.

    Stratos would be handy too..though not so handy I want to pay that much for it (cheapskate) …£20 a year, would be interested though.

    But HipPocket is the most exciting to me to speculate on how advisers and insurers could embed that in their propositions to engage more fully both for pensions and other saving planning and probaly also for protection needs analysis.

    Looking forward to your next instalment.

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